Apex continues prolific growth
Genstar Capital, the California-based private equity firm, had a request of Peter Hughes after it took a stake in the Bermudian-based Apex Group Ltd in 2017.
“Genstar Capital came in and asked me to build the strongest offering there is in asset servicing,” recalls Mr Hughes, who founded the global financial services provider on the island in 2003.
Five years and 31 announced acquisitions by the group later – 28 of which have completed – Apex has moved from $50 billion of assets under administration, custody, depositary and under management to nearly $3 trillion.
The latest and largest deal to close, the all-cash £1.5 billion acquisition of FTSE250 competitor Sanne Group plc, a UK-based leading global provider of alternative asset and corporate services, brought another 2,500 people into the group and added six new locations in Denmark, Japan, Serbia, South Africa, Spain and Sweden.
The acquisition of Sanne adds further depth of product and experience in serving the closed-ended private equity, private debt, capital markets, loan agency, and real assets markets, as well as expanded geographic footprint in the US, central Europe, Africa and APAC, enabling the group to better support clients in every location and stage of their life cycle.
Sanne’s clients will now benefit from access to the group’s single-source solution, including services such as ESG rating, reporting and advisory and digital banking, offered globally and delivered locally by experienced teams.
Apex now operates from more than 80 offices in more than 40 markets worldwide, with 10,000 employees.
Forty staff members work at the company’s global headquarters in Bermuda, including a number of senior managers who have relocated to the island in the past couple of years.
When the deal to acquire Sanne was announced last year, Mr Hughes referred to it as “transformational”.
Now that the transaction has closed, he elaborated: “It adds a lot to our product offering to clients. It brings in a lot of huge institutional clients to our already strong client mix, and allows us to be of service to the top asset managers and moves us from the top three or top five to hopefully being considered the leading provider – that’s what the transformation is.”
Mr Hughes said the transaction was an “inflection point” for Apex, adding: “Taking the business from two people in Bermuda 19 years ago to 10,000 now is a milestone, and one inflection point.
“Another inflection point is bringing in a business the size and scale of Sanne with 2,500 people and a leading product set in the private equity service sector globally – that is really what the acquisition delivers.”
Current economic conditions have revealed a growing trend among Apex’s client base.
Mr Hughes said: “In times like now, with high inflation and a difficult labour market, companies are outsourcing more to third parties like us. It is a good time for us to solve those problems around finding adequate resources in a tough labour market.”
He said the next stage of evolution for Apex would be “using investment in technology to transform how asset managers are serviced and the products that asset managers can deliver to their clients as we evolve the asset management space”.
But Mr Hughes said the business was not just about the numbers.
He said: “It’s conducting business with the right ethics. We are focused heavily on ESG (environmental, social and governance) – we were the first financial services business to offset our carbon footprint from inception.”
Mr Hughes added: “We are particularly committed to driving change across three key themes – women’s empowerment, the environment and education and social mobility – and have some really great initiatives that demonstrate that commitment such as our women’s accelerator programme, our global mobility programme for employees, and the fact we were the first in our industry to offset our entire lifetime of carbon emissions this year.
“We are very aware of the responsibility as a global firm to ensure that capital flows to the right places, and that we leave a good legacy that our children, and children’s children can be proud of.”
Having operations in 42 countries presents both challenges and opportunities.
Mr Hughes said: “Each country has a different culture and being sensitive to those different cultures when you integrate the businesses is the key to doing it well.”
He said the global footprint created options for staff.
“We are focusing on global mobility within the company more than ever before – providing 130 of our people and their families the opportunity to relocate to our other offices around the world to provide them with career and development opportunities, globally.”
Mr Hughes spoke to The Royal Gazette from Europe, where he will stay through the end of the month before moving on to India and Asia until he returns to the island in mid-September.
It is all part and parcel of being the CEO of a global enterprise like Apex; air miles are part of the equation.
Mr Hughes said: “It used to be a huge number before Covid, but I spent a lot of time in Bermuda after Covid hit, which, given our focus on reducing and offsetting the group’s carbon footprint, was no bad thing.
“My air miles have increased in 2022 as restrictions have lifted. I probably still travel several hundred thousand miles a year but Bermuda remains my home base.”